colony of 3,000 in Cape Breton, which afforded an ideal field for settlement, since before 1783 the governor of Nova Scotia had been precluded from granting lands there. In 1784 Cape Breton was erected into a separate government, with a lieutenant-governor of its own; and settlers flocked into it from Halifax, and even from Canada. Abraham Cuyler, formerly mayor of Albany, led a considerable number down the St Lawrence and through the Gulf to Cape Breton. On the mainland of Nova Scotia there were settlements at Halifax, at Shelburne, at Fort Cumberland, at Annapolis and Digby; at Port Mouton, and at other places. In what is now New Brunswick there was a settlement at Passamaquoddy Bay, and there were other settlements on the St John river extending from the mouth up past what is now the city of Fredericton. In Prince Edward Island, then called the Island of St John, there was a settlement which is variously estimated in size, but which was comparatively unimportant.

The most interesting of these settlements was that at Shelburne, which is situated at the south-west corner of Nova Scotia, on one of the finest harbours of the Atlantic seaboard. The name of the harbour was originally Port Razoir, but this was corrupted by the English settlers into Port Roseway. The place had been settled previous to 1783. In 1775 Colonel Alexander McNutt, a notable figure of the pre-Loyalist days in Nova Scotia, had obtained a grant of 100,000 acres about the harbour, and had induced about a dozen Scottish and Irish families to settle there. This settlement he had dignified with the name of New Jerusalem. In a short time, however, New Jerusalem languished and died, and when the Loyalists arrived in May 1783, the only inhabitants of the place were two or three fishermen and their families. It would have been well if the Loyalists had listened to the testimony of one of these men, who, when he was asked how he came to be there, replied that 'poverty had brought him there, and poverty had kept him there.'

The project of settling the shores of Port Roseway had its birth in the autumn of 1782, when one hundred and twenty Loyalist families, whose attention had been directed to that part of Nova Scotia by a friend in Massachusetts, banded together with the object of emigrating thither. They first appointed a committee of seven to make arrangements for their removal; and, a few weeks later, they commissioned two members of the association, Joseph Pynchon and James Dole, to go to Halifax and lay before Governor Parr their desires and intentions. Pynchon and Dole, on their arrival at Halifax, had an interview with the governor, and obtained from him very satisfactory arrangements. The governor agreed to give the settlers the land about Port Roseway which they desired. He promised them that surveyors should be sent to lay out the grants, that carpenters and a supply of 400,000 feet of lumber should be furnished for building their houses, that for the first year at least the settlers should receive army rations, and that they should be free for ever from impressment in the British Navy. All these promises were made on the distinct understanding that they should interfere in no way with the claims of the Loyalists on the British government for compensation for losses sustained in the war. Elated by the reception they had received from the governor, the agents wrote home enthusiastic accounts of the prospects of the venture. Pynchon even hinted that the new town would supersede Halifax. 'Much talk is here,' he wrote, 'of capital of Province… Halifax can't but be sensible that Port Roseway, if properly attended to in encouraging settlers of every denomination, will have much the advantage of all supplies from the Bay of Fundy and westward. What the consequence will be time only will reveal.' Many persons at Halifax, wrote Pynchon, prophesied that the new settlement would dwindle, and recommended the shore of the Bay of Fundy or the banks of the river St John in preference to Port Roseway; but Pynchon attributed their fears to jealousy. A few years' experience must have convinced him that his suspicions were ill-founded.